What’s this “FINAL CHANCE To… Buy $1,600 ‘Tier 2 Gold’ For $8.10 Per Ounce?”

What's Gerardo Del Real teasing in ads for his Junior Mining Monthly? He says we can get in now for "Tier 2 Gold Gains Up To 26,566%"

By Travis Johnson, Stock Gumshoe, March 24, 2020

Today we’re taking a little side path into the gold markets, since gold has recently shown a little spike of enthusiasm following talk of bailouts, and we’ve gotten a bunch of questions about Gerardo Del Real’s “Tier 2 Gold” teaser pitch for Junior Mining Monthly ($99/yr).

So what is he talking about? Well, like most junior mining letters he’ll start out with a big push for gold in general, pointing out the need for gold’s stability in a world of zero interest rates and falling currencies, but he’s also got this notion of “Tier 2 Gold” that he says is so much cheaper than other kinds of gold. Here’s a little taste of that:

“Insiders call it ‘Tier 2 Gold.’

“And it comes from the world’s secret emergency reserves.

“These stockpiles aren’t listed on the books of any central bank. You won’t find any of it in Fort Knox. It’s secured in ‘deep vaults’ around the world.

“If you live in a state like Nevada or Colorado — I guarantee several million ounces are locked away within driving distance of your house.

“And, thanks to a little-known industry loophole…

“You can buy Tier 2 Gold for as little as $12… $15… or $23 per ounce.”

OK, so that’s not a “loophole” — that’s mining, one of the oldest industries on earth, and the only one that can conjure up dreams of alchemy, taking acres of boring-looking land and turning it into gold. And it’s not new that gold projects are valued at less than the “what if we could turn all that gold buried in this rock into gold coins right now” price those ounces would be worth in the real world — of course they are.

Gold is EXPENSIVE to mine, you’ve got to spend years (decades sometimes) finding it, plotting out how much there is and exactly where it is so you can plan to mine it effectively, and then you’ve got to spend huge amounts of money digging up tons of dirt and rock, crushing them to extract the small amount of gold hidden in there, then purifying and melting it down. All using a giant factory that you built, using huge piles of borrowed money and investor capital, maybe hundreds of miles from civilization and partially hundreds of feet below ground.

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But I’ll save some of that high horse lecturing for later — don’t worry, we’ll get back to it. Del Real does eventually reveal that yes, this is mining…

“…yes the gold IS underground.

“But it’s not in some hardened top-secret bunker.

“It’s literally IN the ground.

“Because Tier 2 Gold represents the thousands of tonnes of proven gold reserves sitting undeveloped around the world.

“At low gold prices… these assets stay cheap.

“But when gold prices explode…

“Their value moves higher further and faster than practically any investment you’ll ever see.”

True, but that doesn’t mean the value of that gold in the ground goes from $8 to $1,600 — the market might get more excited about it, but that much more likely to mean going from $8 to $20 or $30 or even $100 as the mine gets bigger or better or achieves major milestones in development and financing (and along the way, that asset will probably be shared among ever larger numbers of shares outstanding — since making that project more valuable takes a lot of work, which takes money, which means they’ll sell more shares to raise that money).

Still, if you get the timing right junior gold projects can present tremendous leverage to the gold price, rising hundreds and sometimes thousands of percent if sentiment shifts for a bit and everyone gets excited about gold again — like January-June of 2016, when gold went up by about 25%, the average huge mining stock went up by more than 100%, and lots of the smaller junior gold names went up by 500-1,000% — so we all dream of occasionally hitting those well-timed breakouts.

And, naturally, the ad hints that fearless editor Gerardo Del Real has got it timed… and that this time it’s going to be driven by bond prices and institutional investors… here’s an excerpt of his projection from the ad:

“How do I know we’ll hit the breaking point in as soon as the next 90 days?

“Simple. Because I know the exact event that will trigger it.

“Ask yourself this: who owns the world’s bonds? The $100 trillion in assets that are the real backbone of the global financial system…

“Trillions of dollars bigger than the stock market.

“Pension funds. Insurance companies. Regional banks.

“They don’t own low- or negative-yield assets because they like losing money.

“They’re literally required to hold them….

“But they won’t eat multibillion-dollar losses forever. Their shareholders and investors won’t let them. Eventually, they’ll be forced to change the rules.

“That’s when the fireworks will begin.

“Trillions in bonds will get dumped, literally overnight.

“Central banks will jump in to backstop the market — printing trillions more.

“And all those institutional investors? They’ll reinvest.

“Most of it will probably wind up in U.S. stocks.

“But a significant chunk will land in gold.”

Then we get into what impact that will have on the gold price…

“The world’s total annual gold production is just 3,200 tonnes…

“Or just $155 billion worth of gold.

“Even if 1% of the $15 trillion in negative-interest securities shifted into gold… it would buy up the entire annual supply.

“And, I think the number will be substantially larger.

“That’s why $5,000 or $10,000 gold isn’t a ‘blue sky’ scenario.

“It’s the base case for when the crisis hits.”

That’s when we get into some reason for concern — when we see a clear forecast from someone who says they know exactly when the world economic system will turn on a dime and begin moving in a new direction. Del Real does not know, any more than you or I, whether investment rules at pension funds will change… or whether those funds will reject bonds and buy gold. He makes a logical argument, but when you’re not looking at the full picture of the world and just pull out a few numbers, it’s very easy to make any argument sound logical… particularly if you’re speaking to someone who doesn’t do advanced economic modeling or work in unpredictable systems.

We all want to think that these things are predictable and logical and easy to make money from, that’s why it was so appealing when Jim Rickards teased his many newsletters over the past several years with a promise that it was a “mathematical certainty” that we’d be returning to a gold standard of some sort, and that the only price for gold that made sense in his forecast was precisely $10,000. It sounded good and logical, and delightfully simple, and we’re always impressed by math, but that doesn’t mean it’s necessarily more reliable than reading your squirrel entrails or the sludge in the bottom of your teacup.

But anyway, the real meat of this ad is not the idea that gold will go to $5,000… it’s that Gerardo Del Real says he has some great stocks to suggest for that world. And, of course, those are top-secret ideas for his subscribers… so let’s see if we can ID them from the clues, shall we?

“PLAY #1

“CODE NAME: Pay Dirt

“Our first play just hit pay dirt on all three holes during Phase II drilling at its Idaho project.

“This property already has a two-million-ounce deposit.

“That’s nearly $3 billion worth of Tier 2 Gold.

“The site was once a producing mine. Over 600,000 ounces have been pulled from it.

“When gold prices fell under $300 in 2000, it was shuttered.

“And, guess what? The best targets are still in the ground. Drilling has identified a 21-meter stretch of 4.55 grams per ton gold.

“There’s another 70 meter stretch of 2.35 grams per ton….

“It could soon be an active mine again. Based on its current market cap, with 2 million ounces in the ground — you’re basically buying this Tier 2 Gold for $17 an ounce.”

Thinkolator says this one is slightly out of date, but that’s Revival Gold (RVG.V in Canada, RVLGF OTC in the US), which was teased by Frank Curzio last Fall as well (though I didn’t write about it at the time)… as is a pretty popular activity in the mining world, an executive from one of the large companies went off on his own to try to build up a new company by restarting an old mine. Though really, the mine was shut down so long ago, more than 20 years now, that it’s more like just getting a head start on the exploration for a new project than “restarting” anything.

You can see Revival’s latest investor presentation here, they’re hoping to advance two projects they’ve acquired, Beartrack and Arnett, and they’re now treating them as one potential project (they’re about four miles apart). They do not have any reserves, but they have identified some high-grade areas of gold in the ground from their drilling, and they’ve increased their indicated and inferred resources so those now total close to three million ounces.

It’s very important to keep in mind that indicated and inferred resources are not at all the same as proven reserves. There’s a continuum of “quality” for minerals in the earth, based on how much drilling and analysis has been done — so an inferred resource is something that you think is probably there in something like a commercially viable quantity, based on initial drilling and some geological understanding of the area. Proven reserves, at the other end, are the result of a lot more drilling to more specifically define what’s underground, with something closer to certainty (though still a ways off — it’s still under ground, after all, and drilling can only show you so much), and proven reserves also come with an economic assessment — not just that the mineral is there, and you’re pretty sure how much is there, but that there’s also reason to believe that you can produce that mineral using defined mining methods and within economic parameters that make real world sense. It takes time and a lot of drilling and geological work to move from “we found gold” to “I think it’s this much gold” to “we’re really sure there’s at least this much gold” to, finally, “I can promise the bank that we’ll be able to produce this much gold at a profit and repay our construction loans.”

Here’s a useful chart that I lifted from New Pacific Metals that might help the visual learners…

Their “updated resource” now has almost exactly three million ounces of resources, split roughly evenly between indicated and inferred resources, with some history and geological analysis that indicates there could be lots more “mineralized” land in their mostly unexplored claim areas, with the deposits they know about being still “open” along strike and at depth (which just means they haven’t clearly found the “end” of the deposit areas yet, so there might be more to find).

And if you’d like confirmation of the match, those drill results that the ad hints at come straight from a press release headline from last summer.

As I type, Revival has a market cap of about US$18 million, so if you want to use that “cost per ounce” metric, spurious though it may be for an early stage company like this, the collapse in the share price means you’re paying about $6 an ounce for those indicated and inferred resources. They indicate that later this year they’ll probably do a preliminary economic analysis for restarting the heap leach pad, which I assume means processing some of the old mining waste on site that didn’t get produced when gold was at $300 an ounce 20 years ago, and will do some more planning for the permitting that will have to get underway, but the next big bit of info would presumably be a preliminary economic analysis for a larger project — and all we know about that is an entry in their presentation that says “20,000 tpd Mill Project PEA?” in 2021.

For now, they’re almost out of money (a common circumstance for junior mining stocks), so they’ve been in the process, for the past several weeks, of trying to offer up to C$5 million worth of shares though a marketed public offering to continue to fund their project development.

Those shares were supposed to be offered at C$0.68 a share, right around where the stock was on March 5 when they started the process, so even though they also include half of a 2-year warrant to buy the stock at C$0.90 there wasn’t really an interest thanks to the collapse in the share price (it dropped about 30-40%, along with pretty much everything else). That led to them pulling the offer today, issuing a press release about slowing down activity to cut costs (“Revival Gold has taken steps to minimize cash expenditures and tighten budgets for the foreseeable future”), and replacing that C$5 million offer with a non-brokered private placement of only one million dollars at below-market prices (40 cents a share). That would keep the company going for a while, I assume, but only if they don’t really do any work — so I’d assume that anything you’re imagining about the future results from Revival should be delayed, the PEA for the heap leach project will probably be later, any further drilling will probably take longer than anticipated, etc.

The good thing, I guess, is that the gold is still there (probably, we have to say, since these are resources and not proven reserves), and if gold prices surge they almost always take essentially all viable junior mining projects higher with them… even if they’re years away from even committing to build a mine, let alone earning anything from it. I would imagine that any persistent strength in gold will help the shares, and that if today’s optimism bleeds through into better investor sentiment at some point in the coming few months, they’ll probably be back to raise a larger amount of money and get some more of the work going again, but that’s all guesswork — for now, they seem to be hunkering down and making sure they don’t really run out of money before they have a chance to move the project forward.

Incidentally, this isn’t the first foray into “Idaho gold” for the Angel Publishing folks — Nick Hodge, if you recall, was saying similar things about the inevitability of gold’s rise and the huge reserve potential of America’s “unknown” largest gold mine in touting Midas Gold starting a couple years ago, in ads that ran for months and months — and despite the fact that it’s a much larger project, and is much further along, that one’s still a sub-$100 million company, too, and those who bought just as those ads started rolling have seen their investment drop 50% in value despite the fact that the gold price is now 20% higher than it was then. There are no guarantees in this little sector, but there are always lots of appealing-sounding stories.

“PLAY #2

“CODE NAME: American Prime

“These guys have an estimated 4.4 million ounces of gold at their property in Mexico.

“They have a $60 million market cap right now.

“Buying this stock is like picking up gold at $13.60 per ounce.

“That’s like trading two coffees for an ounce of gold!

“It gets better. With a feasibility study filed and permitting underway… this project is set to become a mine.

“Once the gold is out of the ground… they’ll get every penny of the $1,600 spot price.”

Well, no, they won’t get every penny of the spot price — they’ll get the profit. Yes, technically the sale of each ounce will hit their revenue line at the full price, but that’s only after they’ve spent the $1,000 or so per ounce that it will take (on average) to operate and finance the mine.

But sadly, I haven’t yet identified which one this might be. I do know that Del Real has spoken positively about Almaden Minerals (AAU, AMM.TO) in the past, with their Ixtaca deposit, and they were at roughly a $60 million market cap a couple months ago (down to $30 million now)… but their resource and reserves base so far is only about 2.5 million ounces, I think, not a match for that 4.4 million number. Incidentally, they also had to pull and revise a private placement fundraising last week… junior miners always need money, and this hit to share prices came at a rough time for some of them.

So that’s a similar kind of stock to what’s being teased, but we can’t name this one just yet… perhaps you’ll have a thought about who it might be to match those numbers with a gold project in Mexico.

We can follow up on that ” gold in the ground” valuation idea a little, though, to try to “cool your jets” in a different way.

So just by way of comparison, SSR Mining’s (SSRM) primary project is the Marigold Mine, and with that and some othero production assets they have about 4.4 million ounces of gold reserves and are producing more than 400,000 ounces a year (ignoring, for the moment, 50 million ounces in silver reserves that would add another million ounces of “gold equivalent”). That leads to about $600 million in revenue and a little less than $60 million in profits per year, and the company is valued based on those metrics, with some credit for their non-producing projects and the potential that they can replace Marigold with other large projects eventually (or extend the mine) when the reserves run dry, at a current market cap of about $1.6 billion. That’s obviously a more sustainable operation, with real profitability, but even SSRM is valued at “only” about $300 per ounce of gold equivalent reserves, not counting resources. The measured, indicated and inferred resources at SSRM would total up to almost exactly 25 million ounces, so if we include those with the reserves that means SSRM, a established company with several producing assets and a lot of financial flexibility, is valued at something like $50 per ounce “in the ground.”

SSRM is not at all a company I’ve studied, by the way, though we’ve certainly seen it teased over the years (it used to be called Silver Standard Resources, in case that rings a bell)… it’s just a company whose materials I came across recently, so it was easy to use as a comparison — I don’t own it and don’t know if it’s relatively good or bad. I just wanted to point out that $50 per ounce “in the ground” is seen by the market, at least in this example, as a relatively reasonable price for an established project that’s actually making money, so don’t get too hung up on whether those “in the ground” ounces are worth $5 or $30 or $50 or $100… each project has to be assessed on its own merits, most mineral discoveries will never turn into a mine, and during times of uncertainty it’s extra important to think about the timeline (and cost) of mineral development from discovery to resource statements to preliminary economic analysis to further drilling and finally feasibility studies, mine financing, and the actual beginning of mine construction. That all takes a long time and a surprising amount of money, so a “core competency” for a mining company is the ability to pulbicize itself, attract investment newsletters and analysts, and sell their ideas to investors so that they can regularly raise more money to keep the project going.

It ALWAYS takes a lot longer than anyone thinks, even when times are good and the money is flowing, but it’s also true that sometimes the junior mining market goes through waves of euphoria that drives up the value of these early-stage projects — so if the project you’re considering has been around for a while you can always go back to the first six months of 2016 for an indication of what can happen during a short, sharp gold bull market… or back to 2011-2012 to see what happened the last time gold really peaked, but remember, if you’re lucky enough to live through a few of those, to sell at some point.

But let’s see if we can name one more for you…

“PLAY #3

“CODE NAME: King Kong

“Our final pick is a MONSTER….

“At 6.5 million ounces and growing, it’s one of the largest deposits in the United States.

“That’s a nearly $10 billion deposit. And that’s at today’s prices. If we hit $10,000 gold — the property might become the most valuable tract of land in America.”

Oooh, exciting! King Kong! He’s so big!

Some other clues?

“Right now, it trades for under $1.00 a share.

“Buying this stock is like owning gold at $8 an ounce.”

And it’s got the imprimatur of another big-name investor:

“John Paulson is one of the most legendary investors of all time.

“He earned his fund $15 billion in 2008.

“When gold surged in 2011 — he called it and pocketed $5 billion.

“Now he’s taken a giant position in the company.”

So that’ll help… what’s this one?

John Paulson has been a meaningfully large institutional investor in gold mining projects for a while now, he has talked up gold for years and currently has a big stake in the precious metal through the SPDR Gold ETF (GLD), though he is, of course, best known for the billion-dollar bets he made (and won) during the financial crisis in shorting mortgage-backed securities.

And his involvement, with those clues, probably narrows it down to the two projects where Paulson’s fund is a major investor (25-30% or so) and has board representation — Midas Gold (MAX.TO, MDRPF) and International Tower Hill Mines (THM, ITH.TO).

Del Real and his publishing colleagues do have a long history with Midas Gold, but it’s also true that their project project is a little smaller, below five million ounces of reserves for the Stibnite project in Idaho right now, so if you’re being literal then THM is probably the fairer match, with their forecast of 6.8 million ounces produced from their (eventual) mining project.

Still, Midas could certainly be the match and that’s where Paulson has been buying more aggressively most recently — you can get to about 6.6 million ounces for Midas if you include all the resources as well as reserves, and Paulson did indeed just take up the entirety of this month’s private placement financing by investing $35 million more into the project (at a lower cost than was anticipated in February, naturally) — if they convert all their convertible notes, Paulson’s funds will own over 40% of Midas Gold, and in conjunction with this last financing they also put Paulson’s Marcelo Kim in as Chairman of the Board. Midas is still a ways from any possible production, but they do have reserves and exploration upside.

Midas is also on a faster timeline than THM — I don’t know if they’ll keep to this schedule (“probably not” is always the best guess for a mining project), but they are expecting to have some major permitting news this year with the draft Environmental Impact Statement, as well as a feasibility study which will provide updated economics for the project — and they think they should have a permitting decision sometime in 2021, followed, assuming they get the mine financed right away and decide to move forward immediately, by about three years of site prep and construction before they start producing, so the goal is to be producing gold somewhere in the neighborhood of 2025. The old estimate for the capital cost of building the mine and getting it up and running was about $1.125 billion, but that will be updated in the next feasibility study.

International Tower Hill Mines (THM), if you want to broaden your look, is the sole owner of the Livengood Gold Project, which is in Alaska but, unlike many of those huge mines we see teased from time to time (Donlin Gold, the Pebble Project), it’s very close to infrastructure (near paved highways and power) and not in a particularly controversial part of the state, environmentally speaking. The company says it’s the largest undeveloped gold project in the United States that’s not already owned by a mining major, and on that “per ounce” metric it’s one of the cheaper ones around, probably down near $5/ounce as of today. The challenge for Tower Hill has been that it’s relatively low-grade, so it’s been hard to justify a big, expensive mine if the economics are at all marginal.

THM’s relatively sober spending outlook, and the connection with Paulson and some other large investors, probably has helped support the stock — after all, unlike some of the others I’ve mentioned they don’t need to raise money right away. As of their annual update, they had about $7 million in cash and plans to spend only $2-3 million this year, which indicates just what an early stage they’re in — they’re not in permitting, they’re just collecting baseline environmental info so they’ll be prepared for permitting in the future… and they’re working still from their 2017 pre-feasibility study that they did to cut the expected capital cost (to just below $1 billion) and make the project smaller and more palatable to finance, with plan for 6.8 million ounces produced over 23 years.

Still, it’s an interesting one and could become a giant IF gold rises considerably and stays at very elevated levels — if gold were at $2,500 an ounce for a decade, for example, Tower Hill would have huge potential as a relatively high-cost mine, with reserves of well over nine million ounces (their first feasibility study back in 2013 estimated a cost of $2.7 billion to build the mine — and a mine that wouldn’t make sense even at $1,600 gold, which is why they downgraded the project to make it smaller and cheaper a few years ago).

So I’d guess that Del Real is still just pitching Midas Gold here, since that’s the safer one and a stock that he and Nick Hodge have touted many times before for Angel Publishing newsletters, but if gold goes bonkers and stays high, I’m sure they’ll both do well eventually — even though there will be fits and starts as they move forward with getting those billion dollar-plus capital infusions for eventual mine construction.

And, of course, asserting that buying a piece of a company that owns a mining project which has “gold in the ground” is at all like buying gold coins from a vault is absurd. It’s sort of like saying that the trees you’re planting from bare-root saplings today, and which you’re pretty sure are apple trees, should be valued as equal to an orchard of mature apple trees producing today. Yes, those saplings probably are apple trees, and they probably will grow apples, if the weather is right and the pest management effective, but it’s very hard to guess at the yield you’ll receive on those trees when they become commercially viable maybe a decade from now (yes, I know the time frame varies widely — as it does for mine development)… and in the meantime, you’re putting in ten years of labor to get them ready, pruning and fertilizing and mowing and paying property taxes, and you don’t know how much people will be willing to pay you for a bushel of apples in 2030, or whether the varieties you’re planting today will be in fashion then.

But that’s true of all mining projects. And I am generally in sympathy with those who expect a rise in the gold price, though I don’t know if it will rise sustainably starting right now. I was writing last week that I agree gold is a likely beneficiary of what’s happening in governments and economies — here’s a little bit of what I wrote in last week’s Friday File:

“So what’s going to happen this time around, money-wise?

“This is the Nostradamus section, so bear with me.

“In the long run, my guess is that the world will return to some semblance of normality within the next 6-12 months, and that the stock market will recover, to at least a significant extent (probably not back to those all-time highs of January right away), before the world feels recovered or normal. I also think that the massive stimulus programs enacted by global governments should trickle through and weaken currencies once the economy begins to move again, like we saw at the tail end of the financial crisis and in the years following the crisis, and that gold should be strong for a few years. Gold doesn’t go up during a crisis, not always, the real safe haven has always been cash because we need cash to buy groceries and make us feel like we’re going to be OK for another week… but it has often gone up right after a crisis. When the worst has passed but investors still fear the world is coming to an end, and when the awareness of the massive debt that was created for the rescue will have to pressure currencies, that’s sometimes when gold really gets a bid.

“So I’ve been thinking about increasing my exposure to gold, and the most appealing way for me to do that, almost always, is through the gold royalty companies — they tend to have almost as much upside as the miners during good times, and much less downside during bad times, and they’re getting clobbered along with the gold price right now in the ‘flight to cash.’ That flight will end eventually, cash is not going to help anyone to build a nest egg once the crisis has passed… I just don’t know when that will be, and when we’ll stop worrying about whether we’ll have a job or whether we have enough toilet paper to get through the week and start worrying about making money again.”

That doesn’t mean all of this will happen on a predictable timetable — remember, we’ve now been living in this world of zero or near-zero (and sometimes negative) interest rates for many years, and we’ve been trying desperately to degrade currencies for decades, and gold has not reacted immediately to every moment of currency depreciation. It moves in waves of speculation and emotional response, like any other traded commodity, but since there is precious little real-world industrial use for gold it doesn’t have that underlying stability (or GDP connection) that you might see from copper, or even from silver or platinum. It’s really almost entirely a financial “get out of currencies” asset.

More importantly, perhaps, gold miners and gold royalty companies don’t always react immediately to gold — they do over time, on average, but they’re also stocks and they offer some liquidity and when people are selling everything they own to raise cash to meet margin calls, or to pay rent, they sell their gold stocks, too. Selling gold stocks is a lot easier than selling gold coins or bars, generally speaking, and people often consider their physical gold to be more like “savings”, but gold stocks are investments and speculations, and those go first.

And just as a final note — like many newsletters, the copywriters get to spin the “legal warning” about how this might not be the right kind of investment for you… into what’s almost a patronizing schoolyard taunt you might hear from the older kids trying to get you to try a cigarette, shoplift a candy bar, or spray-paint the slide…

“Some people just don’t have the stomach for the index-busting gains from the opportunities we set ourselves up for so early. If you think this isn’t for you, don’t worry.

“It’s not for everyone.

“But if you think you can handle it, and want to not only protect your wealth from this economic insanity but also profit like you never imagined…”

So, punk, can you handle it? Everyone who has ever been a boy in high school certainly has the reflex of “of course I’m ready! I’m super tough! I totally already did stuff this cool, it was just in Canada and you guys didn’t see it” (maybe girls are like this, too, I can only speak from my experience… but it strikes me that teen girls tend to get their stupid out in different ways than boys).

But no, this is the real world… and having the “stomach for index-busting gains” means you also have to have the stomach for retirement-crushing losses if you’re speculating on mining stocks. No matter how much logic we might think there is for record gold prices above $1,800 and perhaps much higher over the next few years, we should keep in mind that this logic doesn’t mean gold can’t go back below $1,000 an ounce at some point in the next year or two if investor sentiment shifts. If that happens, any prospective gold project developer can fall by 80% before you even notice what’s happening… so don’t let the patronizing “this might not be for you, it’s only for special people” language take away from the fact that these kinds of investments are really, in the long run, terrible for most people most of the time. This is speculative gambling on massive and capital-intensive projects that take years to progress, and it’s fun sometimes, but make sure not to bet too much on what your expectation of the future trajectory of the gold price might be.

So there you go, I can be patronizing too! Sorry for the lecture, but hopefully that look at some junior mining stocks being teased by Gerardo Del Real will give new folks some taste of what junior mining investments are like. These are interesting ones, with decent backers and relatively appealing-sounding projects, and there are always a few fun stories in junior mining land, but you’ll have to really dig in and get comfortable before you want to put your own capital into a future leveraged gold project like these… and even though 1,000% gains are possible for stocks like these if we have a “gold mania” and price and sentiment shift dramatically higher, remember that the opposite is true, too — if you dig in and get comfortable and become convinced in the merits of a project or a management team, junior miners have a way of surprising you and getting rid of that comfort in a hurry.

Have a favorite in the bunch? A solution for that second one we didn’t ID just yet? Other picks you like in the gold mining space, or a prediction you’d like to share for the gold price? Feel free to use our happy little comment box below — why should I be the only one to put my thoughts and projections into print so that I can find them embarrassing when the world turns upside down next time? 🙂


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Clayborne Hughes
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Clayborne Hughes
May 24, 2020 10:42 pm

Just want say thank you, all these scams no wonder most people hate investing. But I promise once I make enough to be comfortable you’ll do one on me but I’ll give you heads up lol

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Mark Knight
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Mark Knight
June 1, 2020 11:36 pm

In Australia we have a few of these scare-the-pants-off-the-mugs outfits as well. And Jim Rickards often gets a mention. But just recently their voices are getting a bit of traction with the assertion that Petro-Dollars are going to be replaced by the Petro-Yuan and the US economy will crumble into a heap taking Australia and the UK with it.

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james hanson
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james hanson
June 9, 2020 2:46 pm

I read J. Rickards recent pitch. He mentions at the top of his pitch that he is now the largest producer of renewable energy in Maine or something to that affect. It sounds to me like Mr. R. is a bit overextended financially and needs a bit of cash flow, so another miner pitch is the result. I can tell u for free that miners will eventually rule the day, but we may first have to go thru a deflationary period. Also if buying a miner make sure it is in a country that has a dollar swap agreement with the US, otherwise you could end up with a good mine in a location that is liable to nationalize it’s mines if current crises plays out in a bad way.

Dan
Member
Dan
June 24, 2020 6:10 pm

I own RGLD and am happy with it, although it’s just a little more than a hedge play as far as its price appreciation of late. It doesn’t seem to be reacting as well as I anticipated to the price of gold which is why I’m not rushing in to buying a bunch more. You said you like streaming companies over miners, which is why I bought RGLD. What’s your assessment of RGLD and do you have other streaming companies you like better?